Lawmakers seek boost in gas, cigarette taxes

Tuesday

Apr 2, 2013 at 8:00 AMApr 2, 2013 at 9:18 PM

By John Monahan, TELEGRAM & GAZETTE STAFF

BOSTON - House and Senate Democratic leaders today called for a 3-cent hike in the state gas tax, a $1 per pack hike in cigarette taxes, and expansion of the income tax to cover computer design services.

The package outlined by House Speaker Robert A. DeLeo, D-Winthrop, and Senate President Therese Murray, D-Plymouth, is aimed at raising about $500 million in new revenue to close a chronic MBTA operating deficit, fund new transportation initiatives and provide more funds for regional transit authorities.

The proposal comes as an alternative to the transportation elements included in Gov. Deval L. Patrick's $1.9 billion tax hike proposal that is aimed largely at boosting transportation spending, lowering state college costs and expanding early education programs.

The governor earlier this year proposed a hike in the income tax rate from 5.25 percent to 6.25 percent and a cut in the sales tax from 6.25 percent to 4.5 percent.

The plan also changes the tax status of utility companies to raise $83 million. The cigarette tax hike would raise $165 million and the gas tax increase would raise $110 million.

Ms. Murray said "Our No. 1 priority in creating this transportation financing framework was to determine what the actual gap is in our transportation system or what the real need is, and how we can address it while also allowing for future investment in our transportation infrastructure."

Mr. DeLeo said the plan was needed "to keep and grow jobs in Massachusetts."

Since the governor announced his proposals earlier this year — which also called for extending the sales tax to candy and soda and boosting cigarette taxes by $1 per pack — some House and Senate leaders have expressed worry that an tax hike of the size sought by the governor would jeopardize Democratic chances of holding on to the governor's office in 2014.

Former Republican gubernatorial candidate Charles D. Baker and former U.S. Sen. Scott Brown, both considered possible candidates for governor next year, have previously opposed state tax hikes.

Meanwhile the governor has enlisted a broad group of special interest groups, including transportation and education leaders, trade and teacher and other public employee unions in a statewide public appeal for his tax proposals.

Some members of that group held a rally in front of the Statehouse Tuesday morning calling for more funding for transportation improvements, displaying pictures of older train cars and claiming that underfunding has left the state's infrastructure "crumbling." The governor was expected to discuss the proposals at the Statehouse this afternoon.